Week Ahead (8 March)
W/C Monday, 8 March - Irish economic data to be released
The Irish Central Statistics Office will release a slew of economic data in the next week. Monthly services data for January will be released today, followed by industrial turnover for December on Tuesday. On Friday the Residential Property Price index data for January will be released.
The latest data for services showed a 0.3% decrease for 2020 year on year, despite an increase in monthly output of 8.6% in December. Industrial turnover, while down 28.7% in December compared to the previous month, increased by 10.7% in the October to December period and by 4.3% in 2020 as a whole, aided by Ireland's buoyant pharmaceutical and medical device sectors. Meanwhile December's data on Irish property prices in 2020 show a 2.2% increase over the year, with smaller increases recorded in Dublin when compared to the rest of the country.
Tuesday, 9 March - Eurozone GDP/employment data for Q4 2020 to be released
Eurostat will release preliminary data on Tuesday showing the effect of the pandemic on member state GDP and employment in Q4 of 2020. The period saw the widespread imposition of lockdowns across Europe as the second wave of the pandemic took hold, and the data will reflect the subsequent economic impact of those measures.
Thursday, 11 March - ECB Monetary council to decide on whether to tweak PEPP
The Governing Council of the European Central Bank will meet on Thursday to discuss monetary policy. Attention will focus on the speed of the ECB's purchases under the Pandemic Emergency Purchase Programme, PEPP, in the wake of a rise in bond yields in recent weeks. After Lagarde’s initial mis-step, ECB Governing Council members have gone to great lengths to indicate that it will continue to keep borrowing costs low for governments. The overall envelope for PEPP was pushed to €1.85 trillion on 10 December, and over €1 trillion remains for spending in sovereign, corporate and debt markets.
It is understood that the Governing Council is divided over whether to intervene at this point. Dovish sentiment sees the rise in yields in recent weeks as a threat to the recovery of the Eurozone and backs an increase in the pace of PEPP purchases, while some hawks have said that the rise in yields could be due to improved growth prospects and are therefore a welcome development. The President of the ECB, Christine Lagarde, has not made her position known and has stated that the situation with bond yields is being closely monitored.